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Vietjet Aviation Joint Stock Company (VJC) enters the final quarter of 2022 soaring high with a promising revenue increase by 6.5 times in 3Q2022. The airline’s third-quarter report highlights Vietjet’s key role in the global economic recovery as well as lead in the growth rate of domestic and international passengers.
This is all thanks to the company’s dedication in launching more flight routes in a bid to bring more tourists into Vietnam while providing greater route options to countries worldwide. In the third quarter of 2022 alone, Vietjet operated over 35,000 flights transporting 6.4 million passengers, reaping a total revenue of VND10,256 billion (separated) (approx. RM195 million) and VND11,600 billion (consolidated) (approx. RM2.2 billion), shooting up 652% and 337% respectively from the same period last year. With this huge leap, Vietjet has fulfilled 85% of the target set for the year.
Domestic demand contributed significantly to the recovery of passenger transport with the total number of flights and passengers increasing by 36% and 44% respectively, while recovery in international passenger transport is set in motion, reaching about 25% of the pre-Covid 19 records. Separately, the total volume of cargo airlifted was 11,500 tonnes in the last quarter.
This year, Vietjet has launched over ten new international routes to date, with a focus on the Indian market as it strives to expand its footprint into cultural India. These new direct flights connect major tourism hubs in Vietnam such as Hanoi, Ho Chi Minh City, Da Nang and Phu Quoc to cities in India’s West and Central-Southern regions. As of 30 September 2022, Vietjet has operated 84 routes, including 49 domestic and 35 international routes.
In total, Vietjet operated 87,700 flights with 15.4 million passengers during the nine-month period, respectively rising 150% and 225% year on year.
Vietjet’s total assets as of 3Q2022 stands at VND 67,470 billion (approx. RM 12.8 billion), leaving its debt-to-equity ratio remaining at 1.1, a good indicator where the aviation industry is concerned.
With regards to the air transport business, Vietjet recorded an after-tax loss of VND 767 billion (separated) (approx. RM146 million) and an after-tax profit of VND 43 billion (consolidated) (approx. RM8.1 million). Losses for air transport were down by more than 50% compared to 2020 and 2021. However, a hike in jet fuel price at an average of 130 USD/barrel compared to the average of 80 USD/barrel in 2019 made an impact on the airline’s business. Though the air transport business for the last 9 months has yet to break even, the airline has paid up to VND3,048 billion (approx. RM580 million) of direct and indirect taxes and fees to the State.
As air transport operations were dependent on several objective factors such as epidemics and fuel price, the airline responded by steering towards a multi-sectoral strategy to adapt itself to the new context. Consolidated profit was owing to commercial aircraft finance trade from existing orders with Airbus and Boeing amid a supply shortage in the global aircraft market. The airline also gained its revenue from investments in other business and service projects.
Looking ahead, Vietjet is focusing on promotional strategies - especially for international routes, to attract passengers during the peak season of Christmas and Lunar New Year, while preparing for 2023.
Vietjet is also continually improving its services and utilities as it strives to enhance customer experience. One example is Vietjet’s e-wallet payment service that reported revenue gain at the end of 3Q2022. Also showing a positive revenue streak is its subsidiary company of ground handling service that has recorded a profit. Revenue from the pilot and aviation personnel training business also nearly doubled the previous year.
For 4Q2022, Vietjet is forecast to gain higher revenue from an expected growth of passengers, especially in international markets. Vietjet has overcome the pandemic proactively and resiliently. Due to economic conditions in Vietnam, the airline could not receive as much financial support from the state as in other developed countries. Vietjet has proactively expanded its business activities, strengthened its financial standing with the support of shareholders, investors, domestic and foreign partners. The company is always striving to offer affordable prices with excellent service and goods for all passengers, with the aim of contributing to the recovery of Vietnam’s tourism and trade economy while meeting travel demand.
